Mortgage Fraud Battled at State Level

Michigan lawmakers are pushing to revamp state laws to prosecute mortgage fraud, including identity theft. Last year, the state experienced more than $26 million worth of the white-collar crimes, prompting the reform and offering more leeway for prosecution. The new laws would make mortgage fraud a felony, punishable by up to 20 years and giving prosecution the ability to try cases that extend over multiple jurisdictions. The FBI cited Michigan as one of the top 10 hotspots for mortgage fraud, considering that the crime is only a misdemeanor according to current laws.

From 2003 to 2005, mortgage fraud increased in the state from a $9 million problem to more than $25 million, resulting in people loosing their homes and life savings. Most of the fraud originates from inside the mortgage industry itself, with appraisers, bankers, lawyers, accountants and taking part in the scams. The fraud may not only affect a person’s house, but may also result in identity theft, a problem that is also on the rise in the US. The new laws would cover all grounds of mortgage fraud and would involve prosecuting at all levels of the crime.